5 Best Gas Stocks To Buy For 2017

By James Stafford

The unveiling of Tesla’s Model 3 electric car was no less than the lifting of the final curtain on a game-changing energy revolution. And if we follow that revolution to its core, we arrive at lithiumour new gasoline for which the feeding frenzy has only just begun.

Unveiled just on 31 March and already with 325,000 orders, it seems that the market, too, understands that the Model 3 is more than just another electric vehicle. In one week alone, Tesla has racked up around $14 billion in implied future sales,making it the “biggest one-week launch of any product ever.”(And if you think the “implied future sales” negates the news, think again: Each order requires a$1,000 refundable deposit.)

[Related -What’s The Best Electric Car Investment?]

5 Best Gas Stocks To Buy For 2017: Halliburton Company(HAL)

Halliburton Company provides various products and services to the energy industry for the exploration, development, and production of oil and natural gas worldwide. It operates in two segments, Completion and Production, and Drilling and Evaluation. The Completion and Production segment offers production enhancement services, completion tools and services, cementing services, and Boots & Coots. Its production enhancement services include stimulation and sand control services; completion tools and services comprise subsurface safety valves and flow control equipment, surface safety systems, packers and specialty completion equipment, intelligent completion systems, expandable liner hanger systems, sand control systems, well servicing tools, and reservoir performance services; cementing services consist of bonding the well and well casing, while isolating fluid zones and maximizing wellbore stability, and casing equipment; and Boots & Coots include well intervention services , pressure control, equipment rental tools and services, and pipeline and process services. The Drilling and Evaluation segment provides field and reservoir modeling, drilling, evaluation, and wellbore placement solutions that enable customers to model, measure, and optimize their well construction activities. Its services comprise fluid services, drilling services, drill bits, wireline and perforating services, testing and subsea services, software and asset solutions, and integrated project management and consulting services. The company serves independent, integrated, and national oil companies. Halliburton Company was founded in 1919 and is headquartered in Houston, Texas.

Advisors’ Opinion:

  • [By Ben Levisohn]

    The fifteen stocks that Bianco contends could benefit from a trump win are: Johnson & Johnson (JNJ),Pfizer (PFE),Medtronic (MDT), Northrop Grumman (NOC), L-3 Communications (LLL), Halliburton (HAL), Dow Chemical (DOW), Duke Energy (DUK), For Motor (F), Martin Marietta Materials (MLM), Verizon Communications (VZ), Comcast (CMCSA),Charles Schwab (SCHW), Wells Fargo (WFC), Delta Air Lines (DAL).

  • [By Matt Egan]

    Pink slips are flying in the oil patch: Profits at energy giants Chevron and Exxon Mobil fell over 50% around the middle of last year. No wonder many American oil companies, including Halliburton (HAL) and ConocoPhillips (COP) have aggressively slashed expenses to counter lower earnings. Government statistics indicate the energy industry slashed 130,000 jobs in 2015. Actual job losses that include oil-related businesses are likely higher.

  • [By Tony Daltorio]

    The biggest oilfield service companies should get a big lift from the boom, Moors said. That includes Schlumberger Ltd. (NYSE: SLB), Halliburton Co. (NYSE: HAL), Weatherford International Ltd. (NYSE: WFT), and Baker Hughes Inc. (NYSE: BHI).

5 Best Gas Stocks To Buy For 2017: Transocean Inc.(RIG)

Transocean Ltd. provides offshore contract drilling services for oil and gas wells worldwide. It offers deepwater and harsh environment drilling, oil and gas drilling management, and drilling engineering and drilling project management services. The company also offers well and logistics services. In addition, it engages in oil and gas exploration, development, and production activities primarily in the United States offshore Louisiana and Texas, and in the United Kingdom sector of the North Sea. As of February 10, 2011, the company owned, had partial ownership interests in, and operated 138 mobile offshore drilling units, including 47 high-specification floaters, 25 midwater floaters, 9 high-specification jackups, 54 standard jackups, and 3 other rigs, as well as 1 ultra-deepwater floater and 3 high-specification jackups under construction. Transocean Ltd. was founded in 1953 and is based in Zug, Switzerland.

Advisors’ Opinion:

  • [By Ben Levisohn]

    Fleet updates from Noble (NE) and Transocean (RIG) demonstrated that there is, indeed, work to be had at the right price.Raymond James analystPraveen Narra and team like what they saw in Transocean’s fleet update:

  • [By Ben Levisohn]

    Goldman Sachs analystWaqar Syed and team see “green shoots [appearing] in the distance” for oil-field-services sector…just not offshore drillers. They explain why they cut Atwood Oceanics (ATW) and Noble (NE) to sell, where they join Transocean (RIG):

Top 10 International Stocks To Own For 2017: ConocoPhillips(COP)

ConocoPhillips operates as an integrated energy company worldwide. The company?s Exploration and Production (E&P) segment explores for, produces, transports, and markets crude oil, bitumen, natural gas, liquefied natural gas, and natural gas liquids. Its Midstream segment gathers, processes, and markets natural gas; and fractionates and markets natural gas liquids in the United States and Trinidad. The company?s Refining and Marketing (R&M) segment purchases, refines, markets, and transports crude oil and petroleum products, such as gasolines, distillates, and aviation fuels. Its Chemicals segment manufactures and markets petrochemicals and plastics. This segment offers olefins and polyolefins, including ethylene, propylene, and other olefin products; aromatics products, such as benzene, styrene, paraxylene, and cyclohexane, as well as polystyrene and styrene-butadiene copolymers; and various specialty chemical products comprising organosulfur chemicals, solvents, catalyst s, drilling chemicals, mining chemicals, and engineering plastics and compounds. The company?s Emerging Businesses segment develops new technologies and businesses. It focuses on power generation; and technologies related to conventional and nonconventional hydrocarbon recovery, refining, alternative energy, biofuels, and the environment. This segment also offers E-Gas, a gasification technology producing high-value synthetic gas. ConocoPhillips was founded in 1917 and is based in Houston, Texas.

Advisors’ Opinion:

  • [By Lisa Levin]

    Benzinga's newsdesk monitors options activity to notice unusual patterns. These large volume (and often out of the money) trades were initially published intraday in Benzinga Professional . These trades were placed during Monday's regular session.

    Navistar International Corp (NYSE: NAV) Jun16 10.0 Puts Sweep: 902 @ ASK $0.35: 15k traded vs 1749 OI: Earnings Today Before Open $12.22 Ref ConocoPhillips (NYSE: COP) Fri 6/10 44.5 Puts (Wkly): 2000 @ ASK $0.43: 4051 traded vs 80 OI: $44.87 Ref SeaWorld Entertainment Inc (NYSE: SEAS) Sep16 17.0 Puts Sweep: 683 @ ASK $1.40: 2749 traded vs 313 OI: $16.52 Ref

    Posted-In: put optionsNews Options Markets

  • [By Wayne Duggan]

    Bernstein maintains Outperform ratings on the following oil stocks:

    Apache Corporation (NYSE: APA) Anadarko Petroleum Corporation (NYSE: APC) Cobalt International Energy, Inc. (NYSE: CIE) Cabot Oil & Gas Corporation (NYSE: COG) ConocoPhillips (NYSE: COP) Devon Energy Corp (NYSE: DVN) EOG Resources Inc (NYSE: EOG) Range Resources Corp. (NYSE: RRC) Southwestern Energy Company (NYSE: SWN)

    GMP analyst Bob Bakanauskas went long E&Ps back on February 3. He predicts that the oil market will transition from oversupply to undersupply in 2017. From that point forward, the world will once again require shale production growth.

  • [By Tyler Crowe]

    Also, to comound these problems, there isn’t a clear leader of the project that can steer its investment deicisions. ExxonMobil (NYSE: XOM  ) , Royal Dutch Shell (NYSE: RDS-A  ) , Eni (NYSE: E  ) , Total (NYSE: TOT  ) , and Kazakh national oil company KazMunaiGas each have a16.81% working interest in the project. This has led to problems involving investment decisions and project mangement.BothExxonMobilandRoyal Dutch Shellhave been extremelydisappointedwith the results, to the point that they have threatened to pull out of the project altogether on a couple of occasions, andConocoPhillips (NYSE: COP  ) did get out this year by selling its $5 billion stake in the project to China National Petroleum.

  • [By Ben Levisohn]

    Barclays released its first-quarter earnings preview for oil majors like Chevron (CVX), ExxonMobil (XOM), Suncor Energy (SU) andConocoPhillips (COP), and the surprise is that they see when they list the “Biggest Potential 1Q16 Upside Surprise” they follow it with a single word: “None.” Barclays analyst Paul Cheng and team explain why:

5 Best Gas Stocks To Buy For 2017: Apache Corporation(APA)

Apache Corporation, together with its subsidiaries, engages in the exploration, development, and production of natural gas, crude oil, and natural gas liquids. The company has exploration and production interests in the Gulf of Mexico, the Gulf Coast, east Texas, the Permian basin, the Anadarko basin, and the Western Sedimentary basin of Canada; and onshore Egypt, offshore Western Australia, offshore the United Kingdom in the North Sea, and onshore Argentina, as well as on the Chilean side of the island of Tierra del Fuego. Apache Corporation sells its natural gas to local distribution companies, utilities, end-users, integrated oil and gas companies, and marketers; and crude oil to integrated oil companies, marketing and transportation companies, and refiners. As of December 31, 2009, it had total estimated proved reserves of 1,067 million barrels of crude oil, condensate, and natural gas liquids, as well as 7.8 trillion cubic feet of natural gas. The company was founded in 1954 and is based in Houston, Texas.

Advisors’ Opinion:

  • [By Wayne Duggan]

    Bernstein maintains Outperform ratings on the following oil stocks:

    Apache Corporation (NYSE: APA) Anadarko Petroleum Corporation (NYSE: APC) Cobalt International Energy, Inc. (NYSE: CIE) Cabot Oil & Gas Corporation (NYSE: COG) ConocoPhillips (NYSE: COP) Devon Energy Corp (NYSE: DVN) EOG Resources Inc (NYSE: EOG) Range Resources Corp. (NYSE: RRC) Southwestern Energy Company (NYSE: SWN)

    GMP analyst Bob Bakanauskas went long E&Ps back on February 3. He predicts that the oil market will transition from oversupply to undersupply in 2017. From that point forward, the world will once again require shale production growth.

  • [By Ben Levisohn]

    Wells Fargo’s David Tameron and team note that oil exploration & production stocks are “trading well ahead of historical levels” but they find some stocks–includingApache (APA), Anadarko Petroleum (APC), and Gulfport Energy (GPOR)–that still trade at attractive valuations. They explain:

  • [By Matt Egan]

    Before Tuesday, Big Oil’s credit ratings had been left largely intact by S&P. But with oil sinking back to $30 a barrel, the ratings firm took action by downgrading Chevron (CVX), EOG Resources (EOG), Apache (APA), Devon Energy (DVN), Hess (HES), Marathon Oil (MRO), Murphy Oil (MUR), Continental Resources (CLR) and Southwestern Energy (SWN).

5 Best Gas Stocks To Buy For 2017: Encana Corporation(ECA)

Encana Corporation and its subsidiaries engage in the exploration for, development, production, and marketing of natural gas, oil, and natural gas liquids. The company owns interests in resource plays that primarily include the Greater Sierra, Cutbank Ridge, Bighorn, and Coalbed Methane resource plays located in British Columbia and Alberta, as well as the Deep Panuke natural gas project offshore Nova Scotia in Canada. It also holds interests in resource plays comprising the Jonah in southwest Wyoming, Piceance in northwest Colorado, Haynesville in Louisiana, and Texas resource play, including east Texas and north Texas. The company serves primarily local distribution companies, industrials, energy marketing companies, and other producers. Encana Corporation was founded in 1971 and is headquartered in Calgary, Canada.

Advisors’ Opinion:

  • [By Ben Levisohn]

    Citigroup’s Robert Morris and David Zutter explain why they upgraded Encana (ECA) to Buy from Neutral:

    Getty Images

    Deep Resource Base To Drive Strong Liquids Growth
    We project EnCanas total organic production will increase at a ~12% CAGR for 2016 through 2021 with organic oil/liquid volumes increasing at a ~20% CAGR. This growth will be largely driven by the Permian and Montney with Encana’s ‘Top Four’ output (~70% of current total) doubling while the total production mix transitions to ~48% from ~35% liquids in 2021, absent any major non-core asset sales. This growth outlook assumes Encana ramps to 10 rigs in the Permian by 2018 and drills ~2,000 premium return locations in its ‘Top Four’ plays. However, this outlook is above EnCanas recent top-level indication that it will drill ~1,500 premium locations and post a ~10% CAGR for total production through 2021 under its Base Case price deck of flat $55/$3.00.

    …Driving Improved Debt-Adjusted Per-Share Growth Metrics
    Post last weeks equity offering and upwardly revised Permian drilling plan, we project EnCana’s CF/DAS will increase by ~88% in 2016 over this year versus an average increase of ~57% for its oil-leveraged large-cap E&P peers. Recall that CF/DAS has historically had the highest correlation to E&P share price performance (see our 1/5/16 note). Our EPS/CFPS estimates are largely unchanged following adjustments we made last week post the equity offering (see our 9/22/16 note). Also, the equity offering removes Encana from the ‘bad balance sheet bucket’ and should enable it to maintain its investment grade credit rating.

    Given improved debt metrics (thus removal of High Risk rating) and overhang of an equity offering now behind, and with an improved debt-adjusted per share growth outlook, we are upgrading Encana to Buy with a 12-month price target of $13, up from $10, wh

  • [By Ben Levisohn]

    Barclays analyst Thomas Driscoll and team see more dividend cuts and equity raises coming for oil & gas stocks like Apache (APA), Devon Energy (DVN),Encana (ECA), Anadarko Petroleum (APC), and Marathon Oil (MRO). They explain why:

  • [By Ben Levisohn]

    Productivity analysis favors stock picking framework of shale scale + the next rung down. We continue to maintain our Buy ratings on several shale productivity winners such asEOG Resources (CL),Diamondback Energy (CL),PDC Energy (CL),Pioneer Natural Resources and RSP Permian, while increased visibility in a path towards oil price recovery has heightened our confidence in next rung down stocks such as Hess (HES) (CL), Anadarko Petroleum (APC), Encana (ECA), Carrizo Oil & Gas (CRZO) and Whiting Petroleum (WLL). While our well results analysis supports our thesis on these shale scale winners, we note that a number of these higher beta stocks also screened particularly well, further bolstering our view on these equities.

5 Best Gas Stocks To Buy For 2017

By James Stafford

The unveiling of Tesla’s Model 3 electric car was no less than the lifting of the final curtain on a game-changing energy revolution. And if we follow that revolution to its core, we arrive at lithiumour new gasoline for which the feeding frenzy has only just begun.

Unveiled just on 31 March and already with 325,000 orders, it seems that the market, too, understands that the Model 3 is more than just another electric vehicle. In one week alone, Tesla has racked up around $14 billion in implied future sales,making it the “biggest one-week launch of any product ever.”(And if you think the “implied future sales” negates the news, think again: Each order requires a$1,000 refundable deposit.)

[Related -What’s The Best Electric Car Investment?]

5 Best Gas Stocks To Buy For 2017: Halliburton Company(HAL)

Halliburton Company provides various products and services to the energy industry for the exploration, development, and production of oil and natural gas worldwide. It operates in two segments, Completion and Production, and Drilling and Evaluation. The Completion and Production segment offers production enhancement services, completion tools and services, cementing services, and Boots & Coots. Its production enhancement services include stimulation and sand control services; completion tools and services comprise subsurface safety valves and flow control equipment, surface safety systems, packers and specialty completion equipment, intelligent completion systems, expandable liner hanger systems, sand control systems, well servicing tools, and reservoir performance services; cementing services consist of bonding the well and well casing, while isolating fluid zones and maximizing wellbore stability, and casing equipment; and Boots & Coots include well intervention services , pressure control, equipment rental tools and services, and pipeline and process services. The Drilling and Evaluation segment provides field and reservoir modeling, drilling, evaluation, and wellbore placement solutions that enable customers to model, measure, and optimize their well construction activities. Its services comprise fluid services, drilling services, drill bits, wireline and perforating services, testing and subsea services, software and asset solutions, and integrated project management and consulting services. The company serves independent, integrated, and national oil companies. Halliburton Company was founded in 1919 and is headquartered in Houston, Texas.

Advisors’ Opinion:

  • [By Ben Levisohn]

    The fifteen stocks that Bianco contends could benefit from a trump win are: Johnson & Johnson (JNJ),Pfizer (PFE),Medtronic (MDT), Northrop Grumman (NOC), L-3 Communications (LLL), Halliburton (HAL), Dow Chemical (DOW), Duke Energy (DUK), For Motor (F), Martin Marietta Materials (MLM), Verizon Communications (VZ), Comcast (CMCSA),Charles Schwab (SCHW), Wells Fargo (WFC), Delta Air Lines (DAL).

  • [By Matt Egan]

    Pink slips are flying in the oil patch: Profits at energy giants Chevron and Exxon Mobil fell over 50% around the middle of last year. No wonder many American oil companies, including Halliburton (HAL) and ConocoPhillips (COP) have aggressively slashed expenses to counter lower earnings. Government statistics indicate the energy industry slashed 130,000 jobs in 2015. Actual job losses that include oil-related businesses are likely higher.

  • [By Tony Daltorio]

    The biggest oilfield service companies should get a big lift from the boom, Moors said. That includes Schlumberger Ltd. (NYSE: SLB), Halliburton Co. (NYSE: HAL), Weatherford International Ltd. (NYSE: WFT), and Baker Hughes Inc. (NYSE: BHI).

5 Best Gas Stocks To Buy For 2017: Transocean Inc.(RIG)

Transocean Ltd. provides offshore contract drilling services for oil and gas wells worldwide. It offers deepwater and harsh environment drilling, oil and gas drilling management, and drilling engineering and drilling project management services. The company also offers well and logistics services. In addition, it engages in oil and gas exploration, development, and production activities primarily in the United States offshore Louisiana and Texas, and in the United Kingdom sector of the North Sea. As of February 10, 2011, the company owned, had partial ownership interests in, and operated 138 mobile offshore drilling units, including 47 high-specification floaters, 25 midwater floaters, 9 high-specification jackups, 54 standard jackups, and 3 other rigs, as well as 1 ultra-deepwater floater and 3 high-specification jackups under construction. Transocean Ltd. was founded in 1953 and is based in Zug, Switzerland.

Advisors’ Opinion:

  • [By Ben Levisohn]

    Fleet updates from Noble (NE) and Transocean (RIG) demonstrated that there is, indeed, work to be had at the right price.Raymond James analystPraveen Narra and team like what they saw in Transocean’s fleet update:

  • [By Ben Levisohn]

    Goldman Sachs analystWaqar Syed and team see “green shoots [appearing] in the distance” for oil-field-services sector…just not offshore drillers. They explain why they cut Atwood Oceanics (ATW) and Noble (NE) to sell, where they join Transocean (RIG):

Top 10 International Stocks To Own For 2017: ConocoPhillips(COP)

ConocoPhillips operates as an integrated energy company worldwide. The company?s Exploration and Production (E&P) segment explores for, produces, transports, and markets crude oil, bitumen, natural gas, liquefied natural gas, and natural gas liquids. Its Midstream segment gathers, processes, and markets natural gas; and fractionates and markets natural gas liquids in the United States and Trinidad. The company?s Refining and Marketing (R&M) segment purchases, refines, markets, and transports crude oil and petroleum products, such as gasolines, distillates, and aviation fuels. Its Chemicals segment manufactures and markets petrochemicals and plastics. This segment offers olefins and polyolefins, including ethylene, propylene, and other olefin products; aromatics products, such as benzene, styrene, paraxylene, and cyclohexane, as well as polystyrene and styrene-butadiene copolymers; and various specialty chemical products comprising organosulfur chemicals, solvents, catalyst s, drilling chemicals, mining chemicals, and engineering plastics and compounds. The company?s Emerging Businesses segment develops new technologies and businesses. It focuses on power generation; and technologies related to conventional and nonconventional hydrocarbon recovery, refining, alternative energy, biofuels, and the environment. This segment also offers E-Gas, a gasification technology producing high-value synthetic gas. ConocoPhillips was founded in 1917 and is based in Houston, Texas.

Advisors’ Opinion:

  • [By Lisa Levin]

    Benzinga's newsdesk monitors options activity to notice unusual patterns. These large volume (and often out of the money) trades were initially published intraday in Benzinga Professional . These trades were placed during Monday's regular session.

    Navistar International Corp (NYSE: NAV) Jun16 10.0 Puts Sweep: 902 @ ASK $0.35: 15k traded vs 1749 OI: Earnings Today Before Open $12.22 Ref ConocoPhillips (NYSE: COP) Fri 6/10 44.5 Puts (Wkly): 2000 @ ASK $0.43: 4051 traded vs 80 OI: $44.87 Ref SeaWorld Entertainment Inc (NYSE: SEAS) Sep16 17.0 Puts Sweep: 683 @ ASK $1.40: 2749 traded vs 313 OI: $16.52 Ref

    Posted-In: put optionsNews Options Markets

  • [By Wayne Duggan]

    Bernstein maintains Outperform ratings on the following oil stocks:

    Apache Corporation (NYSE: APA) Anadarko Petroleum Corporation (NYSE: APC) Cobalt International Energy, Inc. (NYSE: CIE) Cabot Oil & Gas Corporation (NYSE: COG) ConocoPhillips (NYSE: COP) Devon Energy Corp (NYSE: DVN) EOG Resources Inc (NYSE: EOG) Range Resources Corp. (NYSE: RRC) Southwestern Energy Company (NYSE: SWN)

    GMP analyst Bob Bakanauskas went long E&Ps back on February 3. He predicts that the oil market will transition from oversupply to undersupply in 2017. From that point forward, the world will once again require shale production growth.

  • [By Tyler Crowe]

    Also, to comound these problems, there isn’t a clear leader of the project that can steer its investment deicisions. ExxonMobil (NYSE: XOM  ) , Royal Dutch Shell (NYSE: RDS-A  ) , Eni (NYSE: E  ) , Total (NYSE: TOT  ) , and Kazakh national oil company KazMunaiGas each have a16.81% working interest in the project. This has led to problems involving investment decisions and project mangement.BothExxonMobilandRoyal Dutch Shellhave been extremelydisappointedwith the results, to the point that they have threatened to pull out of the project altogether on a couple of occasions, andConocoPhillips (NYSE: COP  ) did get out this year by selling its $5 billion stake in the project to China National Petroleum.

  • [By Ben Levisohn]

    Barclays released its first-quarter earnings preview for oil majors like Chevron (CVX), ExxonMobil (XOM), Suncor Energy (SU) andConocoPhillips (COP), and the surprise is that they see when they list the “Biggest Potential 1Q16 Upside Surprise” they follow it with a single word: “None.” Barclays analyst Paul Cheng and team explain why:

5 Best Gas Stocks To Buy For 2017: Apache Corporation(APA)

Apache Corporation, together with its subsidiaries, engages in the exploration, development, and production of natural gas, crude oil, and natural gas liquids. The company has exploration and production interests in the Gulf of Mexico, the Gulf Coast, east Texas, the Permian basin, the Anadarko basin, and the Western Sedimentary basin of Canada; and onshore Egypt, offshore Western Australia, offshore the United Kingdom in the North Sea, and onshore Argentina, as well as on the Chilean side of the island of Tierra del Fuego. Apache Corporation sells its natural gas to local distribution companies, utilities, end-users, integrated oil and gas companies, and marketers; and crude oil to integrated oil companies, marketing and transportation companies, and refiners. As of December 31, 2009, it had total estimated proved reserves of 1,067 million barrels of crude oil, condensate, and natural gas liquids, as well as 7.8 trillion cubic feet of natural gas. The company was founded in 1954 and is based in Houston, Texas.

Advisors’ Opinion:

  • [By Wayne Duggan]

    Bernstein maintains Outperform ratings on the following oil stocks:

    Apache Corporation (NYSE: APA) Anadarko Petroleum Corporation (NYSE: APC) Cobalt International Energy, Inc. (NYSE: CIE) Cabot Oil & Gas Corporation (NYSE: COG) ConocoPhillips (NYSE: COP) Devon Energy Corp (NYSE: DVN) EOG Resources Inc (NYSE: EOG) Range Resources Corp. (NYSE: RRC) Southwestern Energy Company (NYSE: SWN)

    GMP analyst Bob Bakanauskas went long E&Ps back on February 3. He predicts that the oil market will transition from oversupply to undersupply in 2017. From that point forward, the world will once again require shale production growth.

  • [By Ben Levisohn]

    Wells Fargo’s David Tameron and team note that oil exploration & production stocks are “trading well ahead of historical levels” but they find some stocks–includingApache (APA), Anadarko Petroleum (APC), and Gulfport Energy (GPOR)–that still trade at attractive valuations. They explain:

  • [By Matt Egan]

    Before Tuesday, Big Oil’s credit ratings had been left largely intact by S&P. But with oil sinking back to $30 a barrel, the ratings firm took action by downgrading Chevron (CVX), EOG Resources (EOG), Apache (APA), Devon Energy (DVN), Hess (HES), Marathon Oil (MRO), Murphy Oil (MUR), Continental Resources (CLR) and Southwestern Energy (SWN).

5 Best Gas Stocks To Buy For 2017: Encana Corporation(ECA)

Encana Corporation and its subsidiaries engage in the exploration for, development, production, and marketing of natural gas, oil, and natural gas liquids. The company owns interests in resource plays that primarily include the Greater Sierra, Cutbank Ridge, Bighorn, and Coalbed Methane resource plays located in British Columbia and Alberta, as well as the Deep Panuke natural gas project offshore Nova Scotia in Canada. It also holds interests in resource plays comprising the Jonah in southwest Wyoming, Piceance in northwest Colorado, Haynesville in Louisiana, and Texas resource play, including east Texas and north Texas. The company serves primarily local distribution companies, industrials, energy marketing companies, and other producers. Encana Corporation was founded in 1971 and is headquartered in Calgary, Canada.

Advisors’ Opinion:

  • [By Ben Levisohn]

    Citigroup’s Robert Morris and David Zutter explain why they upgraded Encana (ECA) to Buy from Neutral:

    Getty Images

    Deep Resource Base To Drive Strong Liquids Growth
    We project EnCanas total organic production will increase at a ~12% CAGR for 2016 through 2021 with organic oil/liquid volumes increasing at a ~20% CAGR. This growth will be largely driven by the Permian and Montney with Encana’s ‘Top Four’ output (~70% of current total) doubling while the total production mix transitions to ~48% from ~35% liquids in 2021, absent any major non-core asset sales. This growth outlook assumes Encana ramps to 10 rigs in the Permian by 2018 and drills ~2,000 premium return locations in its ‘Top Four’ plays. However, this outlook is above EnCanas recent top-level indication that it will drill ~1,500 premium locations and post a ~10% CAGR for total production through 2021 under its Base Case price deck of flat $55/$3.00.

    …Driving Improved Debt-Adjusted Per-Share Growth Metrics
    Post last weeks equity offering and upwardly revised Permian drilling plan, we project EnCana’s CF/DAS will increase by ~88% in 2016 over this year versus an average increase of ~57% for its oil-leveraged large-cap E&P peers. Recall that CF/DAS has historically had the highest correlation to E&P share price performance (see our 1/5/16 note). Our EPS/CFPS estimates are largely unchanged following adjustments we made last week post the equity offering (see our 9/22/16 note). Also, the equity offering removes Encana from the ‘bad balance sheet bucket’ and should enable it to maintain its investment grade credit rating.

    Given improved debt metrics (thus removal of High Risk rating) and overhang of an equity offering now behind, and with an improved debt-adjusted per share growth outlook, we are upgrading Encana to Buy with a 12-month price target of $13, up from $10, wh

  • [By Ben Levisohn]

    Barclays analyst Thomas Driscoll and team see more dividend cuts and equity raises coming for oil & gas stocks like Apache (APA), Devon Energy (DVN),Encana (ECA), Anadarko Petroleum (APC), and Marathon Oil (MRO). They explain why:

  • [By Ben Levisohn]

    Productivity analysis favors stock picking framework of shale scale + the next rung down. We continue to maintain our Buy ratings on several shale productivity winners such asEOG Resources (CL),Diamondback Energy (CL),PDC Energy (CL),Pioneer Natural Resources and RSP Permian, while increased visibility in a path towards oil price recovery has heightened our confidence in next rung down stocks such as Hess (HES) (CL), Anadarko Petroleum (APC), Encana (ECA), Carrizo Oil & Gas (CRZO) and Whiting Petroleum (WLL). While our well results analysis supports our thesis on these shale scale winners, we note that a number of these higher beta stocks also screened particularly well, further bolstering our view on these equities.